Oil and Natural Gas Resources in Wyoming January 2020 Summary Report Wyoming State Geological Survey Erin A. Campbell, Director and State Geologist Laramie, Wyoming phone: 307-766-2286 email: [email protected] website: www.wsgs.wyo.gov
Introduction from 2009 through 2018. This growth is primarily due to Wyoming ranks eighth in the nation in both oil and natural gas operators’ success using horizontal wells to produce from the production, according to the Energy Information Association, or unconventional Codell Sandstone, Niobrara Formation, and EIA. Despite uncertainty in the global economy and supply gluts Muddy “J” Sandstone reservoirs. Associated gas production that threaten to slow the U.S. oil and gas industry, Wyoming oil from these horizontal wells has followed the same growth production is forecast to reach levels not seen since 1993 for the track. In 2018, the Denver Basin accounted for 12 percent of second consecutive year. With substantial reserves of oil and the state’s total oil production and is expected to exceed that in natural gas (the EIA estimates Wyoming reserves are enough 2019. to supply the U.S. with 46 days of oil and 262 days of gas), a favorable regulatory environment, and operators’ increased Greater Green River Basin ability to lower production costs in unconventional reservoir The Greater Green River Basin is the top gas-producing basin in Wyoming, accounting for 60 percent of the state’s 2018 natural the national energy portfolio. The following sections describe gas production. In fact, 38 percent of Wyoming’s 2018 gas development,how each major Wyoming basin willin remain a significant contributor to production was from the the state contributes to 11% 0.6% 55% 13% Wyoming’s oil and natural in Sublette County, two gas production. Pinedaleof the basin’s and Jonahlargest fields and BIGHORN POWDER
Bighorn Basin BASIN Although the Bighorn RIVER mostto being famous Wyoming’s gas fields. Thetop Basin has had steadily Pinedale field, in addition declining production 2009, has also been BASIN since 1978, it still con- WIND 5% 9% gas-producingamong the top fieldthree since oil- tains six of the state’s top RIVER than a decade. In 2018, the (Garland, Hamilton Dome, BASIN producing fields for more 20Elk Basin, oil-producing Oregon Basin, fields more than 3.77 million Spring Creek South, and Pinedalebarrels of fieldoil, second produced only
Grass Creek). Secondary GREATER 12% 0.5% and tertiary recovery the Powder River Basin. GREEN techniques continue to the Salt Creek field in RIVER Projects such as develop- DENVER amounts of oil from the 16% 60% ment within the Normally tobasin’s extract conventional significant BASIN BASIN Pressured Lance federal reservoirs, such as the area and horizontal drill- Phosphoria Formation Map showing percentage of 2018 total statewide production for oil (black) and natural gas and Tensleep Sandstone. (red) for each of the major energy basins in Wyoming. Pinedale Anticline are Very little horizontal ingprogressing on the flanksmore ofslowly the drilling has occurred in the Bighorn Basin, but the potential for unconventional development exists due to the presence of the increase the basin’s total natural gas production if and when same Cretaceous-age formations currently being developed in thanthey come anticipated. online. These long-term projects will significantly other basins. Powder River Basin Denver Basin The Powder River Basin has traditionally been, and continues to The Wyoming portion of the Denver Basin has experienced be, Wyoming’s top oil-producing basin, consistently accounting oil production growth of more than an order of magnitude for at least one-third—and since 2014, more than half—of the Wyoming Oil and Natural Gas Produc�on Land Management (BLM). Like other large oil and gas projects, 2000–2019 this one will also be contingent on prices and market supply. 120 3,000 Oil Oil forecast Natural gas Gas forecast Oil and Gas Transport 100 2,500 Several new pipeline projects are in the works throughout the ) ) state. The 35-mile-long Natural Bridge natural gas pipeline f c B 80 2,000 was recently constructed between Black Hills Energy facilities t , MM bb l
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ub ic f supply point near Douglas. The pipeline began operating in late
a 60 1,500 c
b n n 2019. In eastern Wyoming, the Saddlehorn Pipeline Company o illi illi o b is expanding its Saddlehorn pipeline to Fort Laramie, boosting m 40 1,000 s ( a
G capacity by more than 30 percent to a total of 290,000 barrels of O il ( oil and condensate per day. The pipeline expansion is expected 20 500 to be operational in late 2020. Kinder Morgan and Tallgrass Energy will convert two natural gas pipelines in southeastern 0 0 Wyoming to crude oil pipelines in order to transport more
Year oil from the Powder River and Denver basins to the hub in Cushing, Oklahoma. In March 2019, the BLM approved Denbury Annual Wyoming oil and natural gas production, 2000–2019 (actual production Resources’ construction of the Riley Ridge and the Bairoil-to- through August 2019; forecast production from October 2019 CREG report). Natrona pipelines through Sweetwater, Sublette, Fremont, and state’s oil annually. Increased production in the last decade is Natrona counties. These pipelines will transport CO2 from the largely due to evolving well completion methods and reservoir Riley Ridge Treatment Plant near Big Piney to the Natrona hub targets. Operators are no longer drilling vertical wells into west of Casper to be used for enhanced oil recovery projects in the basin’s high-porosity formations and anticlines. Instead, Montana. they are now successfully producing from low-porosity formations that were once considered uneconomic. Some of Looking Ahead these unconventional reservoirs include the Mowry Shale, the Wall Creek Sandstone (member of the Frontier Formation), the are becoming a thing of the past. Most new wells are being Turner Sandstone (member of the Carlile Shale), the Niobrara Traditionalpermitted asoil andwildcat gas fieldswells, defined especially by conventional in the Powder reservoirs River Formation, the Shannon and Sussex sandstones (members Basin where operators are targeting unconventional, spatially of the Cody Shale), and the Teapot and Parkman sandstones expansive reservoirs. The Wyoming Oil and Gas Conservation (members of the Mesaverde Formation). The 5,000-well Converse County federal development project, which will target new wells which are determined by the Commission to have these Upper Cretaceous reservoirs, is expected to have a record Commissiondiscovered oil defines or gas inwildcats a pool not as “wellspreviously outside proven known productive.” fields or of decision issued in 2020. However, the future of this project, Wildcat wells, the majority of which are Powder River and and Powder River Basin oil production in general, will be Denver basin horizontal wells, accounted for 40 percent of the susceptible to crude oil prices, surpluses, and the international state’s total 2018 oil production. This percent-contribution market. from wildcat wells is expected to continue its upward trend in the future. Although natural gas production has been decreasing since 2009, largely due to the declining coalbed natural gas industry, Wildcat wells' contribu�on to state total oil produc�on 100 the Powder River Basin remains Wyoming’s second-highest State total Wildcat gas-producing basin. Natural gas produced in association with 90 oil from horizontal wells, along with newly discovered areas 80 of gas condensate, are responsible for keeping the basin’s gas production from further decline. 70 60 MM bb l
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r 50 Wind River Basin r a b
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Mountain region’s deepest well are all in the Wind River Basin. illi o Wyoming’s first oil well, first logged well, and the Rocky M 30 last 20 years, with enhanced oil recovery projects offsetting 20 declines in individual well production. Gas production has Oil production in the basin has been relatively flat for the 10 also leveled off from its 2005 high mark. The basin as a whole typically accounts for less than 10 percent of the state’s oil and 0 gas production. Year In the northeastern portion of the Wind River Basin, the 4,250- Oil production from wildcat wells compared to state total production, 2008– well Moneta Divide federal development project is undergoing 2018. an environmental impact statement review by the Bureau of Caption for cover photo: Outcrop of Niobrara Formation “B” chalk.
Intrepreting the past, providing for the future